The current research used McDonald's data to explore the relationship between advertising quality and sales growth. View Summary

The current research used McDonald's data to explore the relationship between advertising quality and sales growth. Based on a 6.5-year dataset involving more than 180,000 consumer interviews, the researchers found that nearly half of McDonald's sales growth could be explained by variables related to advertising quality. Specifically, the study found that factors such as sales momentum, the introduction of calorie content on to quick-service restaurant (QSR, i.e., fast-food) menus, and variables related to key research metrics - and, importantly, the right messaging strategy - can be effective in linking advertising to variation in sales.

Although several brand equity measures have been proposed in the literature, a comparative assessment of their characteristics and performances is lacking. View Summary

Although several brand equity measures have been proposed in the literature, a comparative assessment of their characteristics and performances is lacking. This paper attempts to fill that gap. Combining survey data with real market data, it assesses two types of brand equity measure: customer mind-set measures (brand knowledge) and product-market performance measures (revenue premium). The results confirm that the customer mind-set measure captures cumulative brand-building effects better and offers diagnostic information. However, the revenue premium is found as a better choice for continuous tracking of brand equity because (a) it could reveal the true changes in brand equity; (b) it is a practical and convenient measure since its data requirements are readily available; and (c) it flags any change in brand-equity before the customer mind-set measure. Furthermore, the product-market performance measure is found to precede the customer mind-set. This study also conducts the first empirical test of the well-known brand value chain model on real market data. Finally, operationalising the customer mind-set measure on real market data for the first time, this study confirms that advertising and distribution are positively associated with brand-equity, while price promotion is negatively associated. By considering multiple measures, this study improves the robustness of the findings as well as addressing marketing accountability issues.

This paper looks at the effect of television on return on investment (ROI) and proposes ROI Analyzer: a sustainable model linking TV advertising and sales that takes into account long-term aspects of brand loyalty. View Summary

This paper looks at the effect of television on return on investment (ROI) and proposes ROI Analyzer: a sustainable model linking TV advertising and sales that takes into account long-term aspects of brand loyalty.

The ROI Analyzer examines, in addition to contact with TV advertising, at a variety of independent variables to identify the pure influence of TV as accurately as possible.

Long-term effects are factored into the model through brand loyalty levels.

For each campaign, the ROI Analyzer uses logistic regression to measure the effect of the advertising contacts on brand purchasing over the period of the analysis year, and can project the trend to subsequent years.

It can also simulate what would have happened if there had been no advertising, and early analyses show long-term ROI for the majority of brands is greater than 1.

This paper argues that marketing mix models are not useful, and that the mix models currently in use, either the original format or the newer VAR style, systematically understate the true effects of advertising. View Summary

This paper argues that marketing mix models are not useful, and that the mix models currently in use, either the original format or the newer VAR style, systematically understate the true effects of advertising.

Mix models are regression models and, as such, are incapable of providing truly causal evidence as to the effects of advertising and promotion.

This leads marketers to undervalue the real effects of advertising and to reduce their advertising spending, reallocating those funds to price promotion.

Such reductions in expenditure have the unintended effect of stunting sustainable growth and eroding the brand equity built by advertising.

Moreover, reducing adspend to maximise efficiency is a vicious circle; on the other hand, effective advertising is an engine of growth.

An analysis is performed on the results of 241 real world TV advertising tests conducted by Information Resources, Inc. View Summary

An analysis is performed on the results of 241 real world TV advertising tests conducted by Information Resources, Inc. between 1989 and 2003 to partially update the findings of Lodish et al. [Journal of Marketing Research 32, 2 (1995): 125–39]. Two types of market test results, BehaviorScan and Matched-Market, are analyzed. Overall, the improvement of TV advertising sales effectiveness because of media weight increase is significantly larger than zero for established products, which is different from Lodish et al.’s finding. A further analysis indicates that such significance is mainly driven by more recent tests. A comparison between the new results and Lodish et al. reveals a significant increase in the average advertising effectiveness for tests completed after 1995. The new data still suggest (as did the original data) that it is of great managerial interest to identify advertising effectiveness before launching advertising campaigns.

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A Look at the Long-run Effectiveness of Multimedia Advertising and Its Implications for Budget Allocation Decisions

This study examines the long-term effectiveness of multimedia advertising in a competitive setting and its implications for budget allocation decisions, using multivariate persistence methodology. View Summary

This study examines the long-term effectiveness of multimedia advertising in a competitive setting and its implications for budget allocation decisions, using multivariate persistence methodology. Analysis of network TV, spot TV, and magazine advertising for the two major competitors in the U.S. SUV industry suggested that long-run advertising effectiveness differed considerably among media. These differences were attributed to the media lifespan, retrieval, and content of the message they convey. The authors propose that budget allocation decisions should consider the long-run effectiveness of the different media employed to increase the productivity of advertising campaigns. They also conduct a simulation experiment to further investigate long-run sales effects of alternative allocation strategy scenarios.

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Decay Effects in Online Advertising: Quantifying the Impact of Time Since Last Exposure on Branding Effectiveness

Advertising effectiveness tests combining surveys and electronic tracking of online advertising are common, and the method is increasingly being utilized within more comprehensive, cross-media methodologies. View Summary

Advertising effectiveness tests combining surveys and electronic tracking of online advertising are common, and the method is increasingly being utilized within more comprehensive, cross-media methodologies. The validity of these tests, however, has sometimes been called into question because of the short duration between online advertising exposure and survey taking. Using a unique database containing more than 1,600 online advertising campaigns, we find that there is a measurable but weak relationship between time since last exposure and branding effectiveness, indicating the shortness of duration does not have a substantial impact on the validity of these tests.

Analysis of MMA (Marketing Management Analytics Inc) data found that advertising delivers positive short-term paybacks for six of the twenty non-CPG brands, but for only one of the twenty five CPG (consumer packaged goods brands) studied. View Summary

Analysis of MMA (Marketing Management Analytics Inc) data found that advertising delivers positive short-term paybacks for six of the twenty non-CPG brands, but for only one of the twenty five CPG (consumer packaged goods brands) studied. It showed that positive payback correlates strongly with brand size, and that magazines pay back more than television at current budget allocations.

The current U.S. recency-based scheduling model focuses entirely on the short-term effects of advertising, arguing that in competitive markets the data show that response to advertising dissipates rapidly. View Summary

The current U.S. recency-based scheduling model focuses entirely on the short-term effects of advertising, arguing that in competitive markets the data show that response to advertising dissipates rapidly. This approach leads to consistent moderate weight and near continuous scheduling. Others disagree. Adstock, a well-established concept in the United Kingdom, has been seeping into U.S. planning through globalization and marketing-mix modeling. It has introduced carry-over effects into U.S. TV schedling, which encourage GRP concentration, flighting, and less continuous advertising. We believe that the way Adstock is currently being used by U.S. agencies to modify GRP lay-down is seriously flawed, because it is based on a misunderstanding of what Adstock is. This paper wil explain what we consider to be the fallacy and pinpoint just what place, if any, Adstock can have in media scheduling.

This paper describes the preliminary studies of the effect of advertising and promotion on purchases using the British single-source database Adlab. View Summary

This paper describes the preliminary studies of the effect of advertising and promotion on purchases using the British single-source database Adlab. STAS and logit modeling are the two measures studied. Results from the two measures have been compared to determine the extent to which, they give occasion for the same conclusions. The results indicate that the two measures largely give occasion for similar conclusions.

This article describes the preliminary studies of the effect of advertising and promotion on purchases. View Summary

This article describes the preliminary studies of the effect of advertising and promotion on purchases. The British single-source database Adlab has been the basis for this study of advertising and promotion effectiveness. The STAS measure and logit modelling have been used to estimate the effect of advertising. The results from the two measures have been compared to determine the extent to which the two measures give occasion for the same conclusions. To indicate the accuracy of the two measures, their respective levels of significance have been studied. Two logit models have been estimated; one only includes the effect of TV exposure, while the other also includes the effect of promotions. The results from the two logit models are compared to determine which model gives the most accurate estimate of the effect of advertising. When comparing the results from the STAS measure with the parameter estimates from the second logit model, it is found that these two different measures largely lead to similar conclusions. Suggestions for further research and developments of the models are given.

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Advertising and Promotion Effectiveness - Learnings from a Five-year Study

The British single-source database Adlab has been the basis for this study of advertising and promotion effectiveness. View Summary

The British single-source database Adlab has been the basis for this study of advertising and promotion effectiveness. The STAS measure and logit modelling have been used to estimate the effect of advertising. The results from the two measures have been compared to determine the extent to which the two measures give occasion for the same conclusions. To indicate the accuracy of the two measures their respective level of significance have been studied. Two logit models have been estimated. The first model with an adstock calculation as the only explanatory variable, and the second logit model with promotion and an adstock calculation as the two explanatory variables. The results from the two logit models are compared to determine which model gives the most accurate estimate of the effect of advertising. When comparing the results from the STAS measure with the parameter estimates from the second logit model, it is found that these two different measures largely give occasion for similar conclusions. However from the STAS measure few of the indices were found to be significant while the number of parameter estimates from the logit model that were significant was much higher. Further research and developments of the models are suggested.

Advertising sales elasticity is often used to compare advertising effects (across years, campaigns, media, regions and brands). View Summary

Advertising sales elasticity is often used to compare advertising effects (across years, campaigns, media, regions and brands). Broadbent describes why using 'elasticity' in the form of a coefficient in a logarithmic regression, is wrong; and why seeing 'elasticity as the proportion of sales due to advertising is misleading. He recommends using the advertising coefficient in a linear regression for such comparisons.

This paper outlines the database and methodology used to provide greater depth in modeling the volume effect of advertising and reports the direction of initial findings from this work. View Summary

This paper outlines the database and methodology used to provide greater depth in modeling the volume effect of advertising and reports the direction of initial findings from this work. The efforts are focused on quantifying the long-term effects of advertising as well as providing diagnostic detail on how advertising affects consumer behavior and at a depth of detail that holds potential for improvement of advertising execution

An emphasis on advertising awareness and advertising diagnostics is no longer sufficient for evaluating the impact of advertising and other marketing communications. View Summary

An emphasis on advertising awareness and advertising diagnostics is no longer sufficient for evaluating the impact of advertising and other marketing communications. The measurement of advertising campaigns must also assess both the short and long term effects on the brand.This paper is based on experiences learned and techniques used in continuous brand and advertising tracking studies conducted over the past five years in North America and Brazil. It includes specific case study examples of how advertising campaigns have been evaluated in the context of their impact on overall Brand Equity.

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A Comparison of Two Advertising Effect Models

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Lotte Yssing Hansen, Forum for Advertising Research, Sept 2000

This research paper studies a comparison of advertising effects judged by STAS scores and by the logit model. View Summary

This research paper studies a comparison of advertising effects judged by STAS scores and by the logit model. The British Adlab database has been the basis for calculating the STAS scores and for estimating the parameters in the logit-model. The theory of a Purchase-Viewing bias has also been examined. The significance of the STAS scores and the purchase-viewing scores has been calculated and these have been the basis for the comparison between the two models. Results from this study show that the simple STAS model and the logit-model, when this is kept simple with only one explanatory variable, give occasion to the same conclusions. However, before generalisations can be made it is important to conduct more analysis on larger datasets to ensure the conclusions.

The effects of advertisements must be seen in behaviour before we discuss how individuals are affected. View Summary

The effects of advertisements must be seen in behaviour before we discuss how individuals are affected. Case history analysis is needed; a new source is outlined. There is a common structure for the way sales relate to advertisement exposures. The parameters determining the effects vary within distributions described here; they depend on the brands’ situations and the campaigns’ objectives. We can generalise about what works when. The explanation of how these effects occur must be people-centred. We recognise states like ignorance, learning or conviction; no linear model for which they are stages will suffice. Shoppers reduce dissonance and simplify the world through brand personalities and repertoires. ‘Branding’, or ‘equity’ – the shopper’s construction from experience and beliefs about a brand – can be described and sometimes measured. It is unlikely to be dissected into rational elements and those formed from communication and other marketing activities.

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The Relationship Between Awareness Tracking and Media Investments

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Jarle O Thanlberg, ESOMAR, Radio on the World Stage, Boston, June 1999

The following paper presents the results from the work that Carat Media & Research Norway has done on awareness tracking studies on radio. View Summary

The following paper presents the results from the work that Carat Media & Research Norway has done on awareness tracking studies on radio. This research shows that radio may be an excellent tool in the media mix, but also that the creative works done on radio are in many cases not good enough. Radio is a medium where it is even harder to get your message through than TV, and one should emphasize this fact when considering radio in the media plan.

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Untangling the Confusion of TV Scheduling Theories. Maybe Once is not Always Enough

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ESOMAR, Media Research, Mexico City, October 1998

Complex theories of how advertising works in terms of response, repetition and decay have been merged and confused with the audience-delivery-based media planning concepts of reach and frequency. View Summary

Complex theories of how advertising works in terms of response, repetition and decay have been merged and confused with the audience-delivery-based media planning concepts of reach and frequency. This paper discusses distinctions that should be made in media scheduling between the strategic theories of how advertising works (response functions, decay rates) to deliver aggregate sales effects and the tactics of media buying to determine repetition and cover criteria. While the paper explodes both the myths of 'effective frequency' and 'once is enough', it also suggests a practical, multi-dimensional framework to deal with both ideas, better linking overall brand communication strategies to media buying tactics.

More information is available from single source panels than is often realised. This includes descriptions of the category, of the brand, the associations between brand share and price, demographics, weight of viewing and recent viewing. View Summary

More information is available from single source panels than is often realised. This includes descriptions of the category, of the brand, the associations between brand share and price, demographics, weight of viewing and recent viewing. Data can be aggregated into weeks and normal time series modelling compared with the disaggregate findings; the latter seem to be the more sensitive. Reasons for the brand choice at each purchase occasion can be studied by multivariate regression. These include the shopper's loyalty to the brand, its relative price, a trend term and recent advertising for the brand and for its competitors measured by adstock. Short-term advertising effects have been seen at two to 28 days half life for various brands; no effects have been found for some others. Competitors' adverse effects may be larger or smaller than ours. Diminishing returns to higher current advertising pressure can also be measured and are usually slight. A minority of occasions are under high pressure and most of these are for heavy viewers who are also affected by competitors' activities and often have untypical brand shares. Any bivariate relation between recent advertising exposure and brand choice is potentially affected by purchase/viewing bias which often occurs and by other confounding factors such as price. Such relationships can give misleading indications of advertising effects.

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Analysing relationships between advertising and marketing data.

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Claudio Conti, ESOMAR, Managing Media Data, Rome, November 1996

This paper describes the structure and main features of a tool aiming at understanding the role played by advertising within the marketing environment. View Summary

This paper describes the structure and main features of a tool aiming at understanding the role played by advertising within the marketing environment. A special focus is on the question how explanatory variables are selected and related according to their semantic status.

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Advertising exposure and advertising effects. New panel based findings

The paper describes a proprietary modeling process which has been used to isolate advertising effects of a short-term nature and to document long-term effects. View Summary

The paper describes a proprietary modeling process which has been used to isolate advertising effects of a short-term nature and to document long-term effects. Many of the findings of this work are congruent with the findings of John Philip Jones, particularly the clear-cut ad effects in the week of exposure. However, this model makes use of standard household panel data rather than the 'single-source' data used in Jones analysis and unlike Jones, offers a concrete mechanism for examining long-term effects.

Proposes that advertising should be analysed within a framework of capital budgeting and treated as an investment. View Summary

Proposes that advertising should be analysed within a framework of capital budgeting and treated as an investment. Various recent studies and approaches to budget-setting reviewed. A break-even model to evaluate advertising expenditure is proposed, described and illustrated. The model depends on the profit margin, the decay rate of the advertising effect and the discount rate.

The paper suggests two ways to model the long term effects of advertising. One simply uses adstocks with a long half life. View Summary

The paper suggests two ways to model the long term effects of advertising. One simply uses adstocks with a long half life. The other uses a new expression; cumulative adstock is in dynamic balance with a negative trend which represents hostile forces. This produces a 'floating base' which may move up or down or be stationary. Eleven case histories are summarised, all adequately fitted by one of these systems. A practical strategy for the analyst is recommended.

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Measuring Immediate Responses to Advertising: What You See May Not Be What You Get

Most advertising research practitioners acknowledge the methodological value of combining formal analytical techniques with graphical methods. The latter largely consist of visual examination that, as far as possible, allows the data to speak for themselves. We will demonstrate that an uncritical examination of simple plots may often provide no insights or be grossly misleading. Appropriately constructed graphical views, however, do help us understand the effects of advertising. In particular, we discover a substantial, significant effect of advertising on telephone usage which occurs immediately.